MCX Crude Oil under long liquidation: Support seen at 2358
Commodity Online | May 20 2020
UPDATED 09:50:12 IST

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Technically Crude Oil market is under long liquidation as market has witnessed drop in open interest by 3.53% to settled at 2486 while prices remain unchanged 0 rupees.

Now MCX Crude Oil is getting support at 2358 and below same could see a test of 2313 levels, and resistance is now likely to be seen at 2462, a move above could see prices testing 2521.

Crude Oil yesterday settled remain unchangeby 0% at 2402 steadied amid signs that producers are cutting output as promised just as demand picks up, stoked by more countries easing out of curbs imposed to counter the coronavirus pandemic.

The market was also boosted by signs that output cuts agreed by the Organization of the Petroleum Exporting Countries (OPEC) and others including Russia, a group known as OPEC+, are being implemented on the ground.

OPEC+ has cut its oil exports sharply in the first half of May, companies that track the shipments said, suggesting a strong start in complying with a new production cut agreement.

In further support for prices, U.S. production is also falling, with crude output from seven major shale formations expected to fall by a record 197,000 barrels per day in June to 7.822 million barrels per day.

That would be the lowest since August 2018, according to the U.S. Energy Information Administration.CME Group Inc , operator of the world's largest commodities exchange, has lowered margins for trading NYMEX crude oil futures by 25%, which the group said would be effective after the close of business on Tuesday.

Hedge funds and other money managers raised their bullish bets on U.S. crude futures and options to the highest level in more than a year during the latest week, the U.S. Commodity Futures Trading Commission (CFTC) said.

Trading Ideas:
--Crude Oil trading range for the day is 2313-2521.
--Crude Oil steadied amid signs that producers are cutting output as promised just as demand picks up.
--U.S. production is also falling, with crude output from seven major shale formations expected to fall by a record 197,000 barrels per day in June.
--CME Group Inc , operator of the world's largest commodities exchange, has lowered margins for trading NYMEX crude oil futures by 25%.

Courtesy: Kedia Commodities